Basic Accounting Principles

Accounting is simply the process used to figure out how much money a business made during a certain time period.

• True

• False

What are the accounting rules used to prepare, present and report financial statements called?

• Standard Business Financial Practices

• Financial Accounting Standards

• Generally Accepted Accounting Principles

• Financial Account Management Techniques

__________ are items of value your company owns.

• Profits

• Revenues

• Liabilities

• Assets

__________ are any debts or obligations owed by the company.

• Profits

• Revenues

• Liabilitites

• Assets

It is often beneficial for a business owner to use business accounts and personal accounts interchangeably.

• True

• False

A(n) __________ is a summary of a company’s profit or loss during any one given period of time.

• Income Statement

• Balance Sheet

• Subledger

• Fixed asset statement

How often should a business calculate profitability and review financial statements?

• Weekly

• Monthly

• Quarterly

• Annually

The Financial Accounting Standards Board is the government agency regulating the accounting industry.

• True

• False

How many steps are in the business operating cycle?

• Eighteen

• Twelve

• Nine

• Five

Income statements are used to help determine __________.

• Employee pay

• Prices of goods and/or services

• An accountant's capabilities

• Credit limits